Chicago | Reuters — Chicago Mercantile Exchange live cattle futures extended a winning streak to four sessions on Thursday with help from better-than-expected cash prices and firm wholesale beef values, traders said.
June live cattle, which expired at noon CT, closed 1.1 cents/lb. higher at 120 cents (all figures US$). Most actively traded August ended up 0.7 cents, to 114.825 cents.
On Thursday, most market-ready, or cash, cattle in the U.S. Plains brought $122/cwt, up from $116-$118 a week earlier, according to feedlot sources.
“They’re (packers) making so much money on these cattle that they want to own them and paid higher money to do it,” said Vetterkind Cattle Brokerage president Troy Vetterkind.
Beef packer margins for Thursday, on average, were a positive $83.30 per head, up from a positive $74.10 on Tuesday, as calculated by HedgersEdge.com.
Before Thursday, wholesale beef prices generally trended lower although sales volume was characterized as brisk at lower price levels.
“We’ve been doing some very active beef business not only domestically, but in the export market the past several weeks,” said Vetterkind.
The morning’s choice beef price was at $209.32/cwt, 75 cents higher than on Wednesday. Select cuts were up 53 cents to $196.41, the U.S. Department of Agriculture said.
Technical buying, CME live cattle market advances and sharply lower corn futures sent the exchange’s feeder cattle contracts higher.
Less expensive feed helps reduce input costs for feedlot operators.
August feeders closed 1.25 cents/lb. higher at 144.3 cents.
Weak hog futures settlement
The morning’s lower cash and wholesale pork prices weighed on CME lean hogs, traders said.
July ended 0.25 cent/lb. lower at 82.85 cents, and August finished down 0.05 cent to 83.275 cents.
Cash hog prices around the Midwest Thursday morning were steady to down 50 cents/cwt, according to regional hog buyers.
Thursday morning’s wholesale pork price fell $1.11/cwt from Wednesday to $88.58, after the ham price plummeted almost $13, USDA said.
Packers have enough hogs at their disposal to handle the July 4 holiday-shorted kill week, an Indiana hog buyer said.
Analysts and traders said supermarkets curbed pork purchases until they can evaluate how much product cleared meat cases over the long holiday weekend.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.